Daily Currency Update

The Australian dollar edged marginally higher through trade on Monday, bouncing off supports at 0.70 US cents as investors looked to unwind some of Friday’s risk off move. Market sentiment improved following reports that suggest the Omicron variant, while bypassing the protections afforded by our current vaccines, will not foster a severe immune response and illness as is the case with other more virulent COVID 19 strains. Initial anecdotal date appears encouraging; however, we anticipate price action will remain whippy over the coming days and weeks as sentiment shifts ahead of any real scientific evidence and data analysis as to the effects this latest mutation. Commodity prices recovered through Monday, lead by a 35 surge in Oil, dragging the CAD and AUD higher on the day. Added support came on the back of the Peoples Bank of China policy update. As expected, the PBOC opted to cut the reserve ratio requirement, opening up accommodative monetary policy conditions while highlighting its support for the commercial building market. Having touched intraday highs at 0.7055 overnight the AUD leveled off into this morning’s open, bouncing between 0.7040 and the daily high. Our attentions turn now to the RBA and its last policy update for the year. We expect few surprises with policy makers likely to maintain the current policy platform. Another dovish assessment could add further pressure downward on the AUD.

Key Movers

A positive risk backdrop helped fuel gains across risk assets and commodity currencies on Monday, driving the JPY and CHF toward the bottom of the leader board as the worst performing majors to start the week. The USD has rebounded back above 113.50 against the Yen while the Pound enjoyed incremental gains, staving off a break below 1.32 and the Euro continues to underperform. Market sentiment remains whippy and volatility indices elevated, the VIX volatility index trading near 30% it s highest level in 6 months highlights just how nervous investors are. Elevated volatility means larger price swings and we expect currency values will fluctuate wildly over the coming days and weeks as we await clear evidence this latest COVID 19 variant will not disrupt the recovery.  Our attentions today turn to the RBA monetary policy update, while US and Chinese trade data and German industrial production dominate the macroeconomic ticket.

Expected Ranges

  • AUD/USD: 0.6980 – 0.7130 ▲
  • AUD/EUR: 0.6180 – 0.6330 ▲
  • GBP/AUD: 1.8650 – 1.8930 ▼
  • AUD/NZD: 1.0350 – 1.0520 ▲
  • AUD/CAD: 0.8950 – 0.9030 ▲

IMPORTANT: This information has been prepared for distribution over the internet and without taking into account the investment objectives, financial situation and particular needs of any particular person. Oz Forex Foreign Exchange makes no recommendations as to the merits of any financial product referred to in this website, emails or its related websites. Please read our Product Disclosure Statement and our Financial Services Guide.

Regulated in Australia by ASIC (AFS Licence number 226 484)
© 2010 Copyright Oz Forex Foreign Exchange Pty Ltd ABN 65 092-375-703
OzForex Foreign Exchange Services

Member of FOS (Financial Ombudsman Service)
Full Member of AFMA (Australian Financial Markets Association)

Feed news Join Telegram

Recommended Content


Recommended Content

Editors’ Picks

EUR/USD remains pressured near 1.0250 amid renewed USD strength

EUR/USD remains pressured near 1.0250 amid renewed USD strength

EUR/USD remains pressured near 1.0250, undermined by a broad rebound in the US dollar after dismal Chinese data soured sentiment. Growing recession fears in the Eurozone amid the deepening energy crisis weigh down on the euro. 

EUR/USD News

GBP/USD drops towards 1.2100 as US dollar firms up

GBP/USD drops towards 1.2100 as US dollar firms up

GBP/USD is dropping towards 1.2100, as the US dollar rebounds amid a negative shift in risk sentiment amid weak China data. BOE’s Bailey shows readiness for a ‘review’ on UK PM Candidate Truss’ criticism. Critical UK data and Fed minutes are in focus this week. 

GBP/USD News

Gold closes the week above 50 DMA, what’s next? Premium

Gold closes the week above 50 DMA, what’s next?

Gold price is reversing Friday’s rebound above $1,800, as bears return at the start of the week. Buyers appear to lack follow-through upside momentum, as souring risk sentiment revives the US dollar’s safe-haven appeal.

Gold News

Tezos to provide bulls a generous exit before a 15% nosedive

Tezos to provide bulls a generous exit before a 15% nosedive

Tezos Price is hovering above a stable support level after facing an intense rejection. While this foothold is likely to provide harbor, it will not be for long. Investors must prepare for a long squeeze as bears make an elaborate move.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!

BECOME PREMIUM

Majors

Cryptocurrencies

Signatures